The biggest threat to any business is that it's customers will decide to quit buying. When a Taco Bell in New York was taken over by rats, it wasn't because there was no government inspector. There's always a government inspector, but they fail constantly even though they cost a lot. So Taco Bell does what any corporation in this situation does:
Fire some irresponsible workers
Suck up to the untouched customers
Make amends to the harmed customers
See where quality control went haywire
Fear of loss of customers is the best kind of regulation; nobody has to be taxed to pay for it, businesses with a better track record will gain ground on consistent under-performers, industry leaders will find cheap ways to improve safety -- which will improve the whole industry when competitors copy the new best practices. All of this comes about because customers have so many ways to find out how corporations are screwing up. This guarantees incremental improvements and more efficient, cheaper ways to make customers happy.
So these are the basic reasons we don't usually need legislation to improve safety. The demands of customers for constant improvements and cheaper prices will drive corporations to find safer ways to do things than those that are now known.
But liberals can't accept this because they can't see how any process which omits government could lead to steadily greater outcomes and more order. They think it's impossible for the undirected actions of millions of individuals to have an effect on corporations. They demand legislative fixes instead. This is what leads to atrocities like the CPSIA which have the primary effect of removing competition and new sources of ideas for quality control from the marketplace. The key thing to remember is that with all government regulations, the public forces loudly demanding the legislation are not the only forces who quietly support it. The biggest corporations (whose screw-ups may have precipitated the liberal outcry for regulation in the first place) may want the legislation (with its increased costs) because it keeps new competition out of the market.
This audio clip is an hour long and describes how GM (with the help of some liberal do-gooders) screwed Honda with a catalytic converter. If you want to know how government regulations are impoverishing you, this is a good place to start.
